1. This is a petition under Art. 226 of the Constitution praying for a writ of certiorari quashing the award dated 7 June 1962, passed by the labour court, Bangalore, in Reference No. 9 of 1962 made by the State Government on 15 February 1962.
2. The petition has been filed by one Badri Prasad as partner of Bombay Indra Bhavan, a restaurant carrying on business in Mysore. Respondent 1, who is the contesting party, had been employed as a cook for preparing cakes. On account of his frequent absenteeism without previous permission, his services had been twice terminated - once on 26 July 1961 and again, on 9 September 1961 - but he had been taken back into service on account of a written undertaking given by him once before the conciliation officer to the effect that he would not absent himself from duty without prior permission and on the next occasion on oral assurance before the same officer. In spite of these assurances, respondent 1 (hereinafter called the respondent) absented himself from the afternoon of 30 October 1961, without obtaining prior leave. The petitioner called for the explanation of the respondent and terminated his service with an offer of one month's wages in lieu of notice as his explanation was found to be unacceptable. The respondent raised an industrial dispute through the Mysore City Hotel Workers' Association (respondent 2), and the State Government made the aforesaid reference to the labour court, Bangalore.
3. It was contended before the labour court that the termination of the service of the respondent was not preceded by any enquiry and that the entire proceedings were illegal as being contrary to the principles of natural justice. It was contended on behalf of the petitioner that the order of termination of the services of the respondent had been passed under S. 41 of the Mysore Shops and Establishments Act, 1948, that the order had become final on account of the respondent's failure to challenge the same in appeal and that the reference made by the Government under S. 10(1)(c) of the Industrial Disputes Act, 1947, was bad in law. The petitioner sought to justify his order on merits by producing documents to relating to prior absence and the undertaking given by the respondent. The labour court was of the opinion that the order of termination of service violated the principal of natural justice as the management of the petitioner establishment had not held a proper domestic enquiry for reaching the conclusion that the respondent was guilty of absenting himself from duty without permission from the afternoon of 3 October 1961. As a result of this finding, the Court passed an award directing the management of the petitioner to reinstate the respondent in his former post and pay him full wages from the date of termination of his service to the date of his reinstatement.
4. The legality of this award has been challenged Sri R. M. Seshadri, appearing for the petitioner, on three grounds -
(1) The dispute in the instant case was not an industrial dispute and the reference made by the State Government under S. 10 of the Industrial Disputes Act, 1947, was without jurisdiction.
(2) Even assuming that there was a valid reference, the Court had exceeded its jurisdiction in sitting in judgment over the order passed by a domestic tribunal in accordance with the provisions of the Mysore Shops and Establishments Act, 1948.
(3) Even if the labour court had jurisdiction to go into the dispute, it could not have passed an award for reinstatement and payment of all back-wages in view of the provisions contained in S. 41 of the Mysore Shops and Establishments Act, 1948.
5. We shall deal with each of these contentions in their order.
6. The first contention raised on behalf of the petitioner is that there was no industrial dispute inasmuch as the dispute raised by the respondent had not been supported by an appreciable or substantial number of employees belonging to his class. In support of this contention, reliance was placed on the decision of the Supreme Court in Indian Cable Company. Ltd., Calcutta v. their workmen [1962 - I L.L.J. 409], in which it has been laid down that the policy behind the Industrial Disputes Act is to protect the workmen as a class against unfair labour practices and what imparts to the dispute of a workman the character of an industrial dispute is that it reflects the rights of the workmen as a class. Their lordships further laid down that the dispute of a single workman would become an industrial dispute when it is sponsored by a union or by a considerable number of workers. The decisions of the Madras High Court in V. N. Transports v. Coimbatore Motor Workers' Union [1960 - I L.L.J. 481] and of the Supreme Court in Bombay Union of Working Journalists v. 'Hindu.' Bombay [1961 - II L.L.J. 436], were also cited on behalf of the petitioner. In the latter case, the Supreme Court laid down that the dispute involved in the case could acquire the character of an industrial dispute only if it was proved that it was, before it was referred, supported by the union of the employees of the 'Hindu,' Bombay, or by an appreciable number of its employees; the mere support to the cause of the concerned workman by the union cannot, therefore, convert the individual dispute of one of its members into an industrial dispute. Sri Rangaswami Ayyangar, appearing for the first two respondents, contended that as this question had not been specifically raised before the labour court, his clients had no opportunity to adduce evidence to show that the support of the respondent's case by ten members of the executive committee of the Mysore City Hotel Workers' Association, had, in fact, the backing of a substantial number of workers of the petitioner's establishment or of the association. Since it appears from the facts of this case that the point dose not appear to have been expressly taken before the labour court, we refrain from deciding this contention of the petitioner as his case rests on firm grounds in respect of the other two contentions.
7. The second contention raised on behalf of the petitioner is that the labour court had exceeded its jurisdiction by sitting in judgment over the decision arrived at by the petitioner's management and that the award deserved to be struck down on that ground. It cannot be disputed that the provisions of the Mysore Shops and Establishments Act, 1948 (hereinafter called the Act) - as indicated by the preamble-which regulate 'conditions of work in shops, commercial establishments, restaurants, theatres and other establishments' apply to the service conditions of an employee working in a restaurant. The term 'establishment' has been defined in S. 2(6) of the Act as meaning 'a shop, commercial establishment, restaurant, eating-house, residential hotel, theatre, or any place of public amusement or entertainment ...' The Act is a self-contained code containing provisions in regard to health and safety, holidays with wages, wages, inspection of establishments by duly appointed inspectors and the appointment of a Labour Commissioner for decision of disputes arising under the Act. It also provides for penalties for an employer who contravenes any of the provisions specified in S. 45 of the Act intended for safeguarding the health, safety and security of services of the employees.
8. It was submitted on behalf of the petitioner that the order passed by him against the respondent was consistent with the provisions contained in S. 41 of the Act and that the labour court had completely overlooked those provisions in embarking upon an enquiry into the legality of the impugned order and holding it to be illegal on the ground that it had not been preceded by an enquiry consistent with the rules of natural justice. That section reads as follows :
'41. (1) No employer shall dispense with the services of a person employed continuously for a period of not less than six months, except for a reasonable cause and without giving such person at least one month's notice or wages in lieu of such notice, provided, however, that such notice shall not be necessary where the services of such person are dispensed with on a charge of misconduct supported by satisfactory evidence recorded at an inquiry held for the purpose.
(2) The person employed shall have right to appeal to such authority and within such time as may be prescribed either on the ground that there was no reasonable cause for dispensing with his services or on the ground that he had not been guilty of misconduct as held by the employer.
(3) Where the services of a person have been dispensed with in contravention of the provisions of Sub-section (1), such person shall, where the employer does not agree to reinstate him, be entitled to such compensation as the appellate authority may determine, provided that such compensation shall not exceed an amount calculated at one month's wages for every year of service subject, in any case, to a maximum of six months' wages.
(4) The decision of the appellate authority shall be final and binding on both the employer and the person employed.'
9. The submission on behalf of the petitioner is that the petitioner had 'reasonable cause' to terminate the services of the respondent, that he had offered him one month's wages in lieu of notice and that the order of termination was consistent with the provisions of Sub-section (1) of S. 41. Though the labour court referred to this aspect of the case, it does not appear to have applied its mind to the provisions of law and the grounds on which the petitioner sought to justify his order in Para. 6 of the award, there is a discussion with reference to the previous absence of the respondent without prior permission. It would be clear from the discussion that the respondent had absented himself without leave, in July 1961, that a notice had been issued to him on 18 July 1961 to show cause and that, on considering the reply given by the respondent, an order terminating his services (Ex. M. 11 before the labour court) had been passed on 21 July 1961. It also appears that on the intervention of the inspector of shops and establishments, the parties filed a joint memo dated 26 July 1961, before the aforesaid officer stating that 'the worker undertakes that in future he will not avail himself of leave without previous permission.' On this undertaking, the petitioner withdrew the order of termination. It is further clear that the respondent absented himself again in September 1961, without prior notice and, as a result of conciliation proceedings, the petitioner agreed to take back the respondent again into service. After referring to these two prior incidents the Court concluded :
'.... It is, therefore, clear from this documentary evidence of unimpeachable character that the parties had squared up the matter in respect of irregular attendance and defiant attitude of the workman in the past. Sri B. Jayaprakash, M.W. 1 frankly further stated in his evidence that the workman, S. R. Sastri, absented himself from duty without permission on the afternoon of 30 October 1961, and, therefore, he issued him a show-cause notice, Ex. M. 2, On 31 October 1961, to which the workman sent a reply dated 2 November 1961. Ex. M. 3, explaining that he was ill and, therefore, could not attend to duty and prayed for the grant of leave ...'
10. It does not appear to have been disputed before the labour court that the absence of the respondent from the afternoon of 30 October 1961 was without permission. His explanation was and is that he could not attend to duty as he developed leg-ache and fever late on that day or the next day. The petitioner called for the explanation of the respondent and issued him the following order on 5 November 1961 :
'Your letter is no explanation for the charges that are made in our letter dated 31 October 1961. On many previous occasions you absented yourself from duty without permission or intimation and that you absented yourself without permission or intimation from the afternoon of 31 October 1961. Such conduct on the part of an employee cannot be viewed by us with equanimity. When we attempted to get the show cause dated 31 October 1961 served on you were away from home and it was only in the evening at about 8 p.m. that our servant found you in the hotel association premises and delivered you the letter. This clearly shows that your statement of fever, leg-ache and other illness is completely untrue.
11. 'We have, therefore, no option but to dispense with your services.
'One month's wages in lieu of notice will be paid to you when you call in our office. Any other sum that you may be entitled to as per law, will also be paid to you.'
12. It is, therefore, clear that the services of the respondent were terminated in pursuance of the first part of Sub-section (1) of S. 41. That provision does not contemplate any enquiry to precede the issue of a notice dispensing with the services of an employee for a reasonable cause. The presiding officer of the labour court has not considered whether the order dispensing with the services of the respondent had been based on a reasonable cause or not. The notice itself offers the respondent one month's wages in lieu of notice and expresses the petitioner's preparedness to pay any other sum that he might be entitled to under the law. It should be noted that the proviso contained in Sub-section (1) of S. 41 expressly mentions that such notice will not be necessary where the services of an employee are dispensed with on a charge of 'misconduct supported by satisfactory evidence recorded at an inquiry for the purpose.' If the law had contemplated that an enquiry was necessary for dispensing with the services of an employee for a reasonable cause, it would have so provided. Sri Rangaswami Ayyangar for the respondent contended that the termination of service was for alleged misconduct and that an enquiry as contemplated by the proviso was a condition precedent for the valid termination of his client's services. We are unable to accept this contention since no notice issued and the nature of the action taken does not show that the services were terminated for mis-conduct. It may be mentioned that if the services had been dispensed with on a charge of misconduct as contemplated by the proviso, no such notice as is now given was necessary. We have, therefore, no hesitation in holding that the labour court failed to consider the relevant provisions of the Act in holding that the order terminating the services of the respondent was bad in law.
13. Sri Rangaswami submitted that it was not open to the High Court to interfere with the findings of the Court, and sought sustenance for that argument from a decision of the Supreme Court in D. N. Banerjee v. P. R. Mukherjee [1953 - I L.L.J. 195]. Therein their lordships laid down :
'Whether on the facts of a particular case the dismissal of an employee was wrongful or justified is a question primarily for the tribunal to decide, and here the tribunal held that the dismissals were clear cases of victimization and hence wrongful. Unless there was any grave miss carriage of justice or flagrant violation of law calling for intervention, it is not for the High Court under Arts. 226 and 227 of the Constitution to interfere.'
14. In the instant case, we have shown above that the labour court has not considered the provisions of law. We shall presently indicate that the award passed in the present case is a flagrant violation of law.
15. Sri Seshadri, appearing for the petitioner, submitted that instead of confining itself to a consideration of the relevant provisions of S. 41 of the Act, the labour court had exceeded its jurisdiction by constituting itself into an appellate authority over the decision of the domestic tribunal. In support of his argument, he cited the decision of the Supreme Court in Balipara Tea Estate v. Its workmen [1959 - II L.L.J. 245]. The headnote therein which precisely summarizes the ratio of the decision reads thus :
'An industrial tribunal, while adjudicating on an industrial dispute relating to dismissal of a workman for misconduct, has not got to decide for itself whether the charge framed against the workman concerned has been established to its satisfaction. It has only to be satisfied that the management was justified in coming to the conclusion (in bona fide and proper domestic enquiry) that the charge against the workman was well-founded. If it finds in any given case that the management was actuated by any sinister motives, or had indulged in unfair labour practice or that the workman had been victimized for any activities of his in connexion with the trade union, it would have reasons to be critical of the enquiry held by the management.'
16. It is not the case of the respondent that the order passed by the management had been actuated by any sinister motive or that the petitioner had indulged in unfair labour practice in victimizing him. The respondent has admitted in the labour court that the management had no animosity against him. Reliance was also placed on the decision of the Allahabad High Court in Banaras Electric Light and Power Company, Ltd. v. Government of Uttar Pradesh and others [1962 - I L.L.J. 14]. In that case, the contract of service of the employee provided for termination of the service without assigning any reason by giving one month's notice or on payment of one month's salary in lieu of notice. The standing orders also contained a provision that an employee could be discharged not only for proved misconduct but also when the employer had lost confidence in him. The services of an employee in that case were discharged in pursuance of the terms of contract on payment of one month's salary. The labour court adjudicating the dispute relating to the discharge of the employee, as in the present case, did not find that the employer acted mala fide in exercising his power. It, however, set aside the order of termination on the ground that it was not in conformity with the standing orders which required the service of a chargesheet on an employee and the giving of reasonable opportunity to explain the charge. The labour court passed an award for reinstatement. In quashing the award of the labour court in a writ petition preferred by the employer, it was held that the termination of the services in pursuance of the contract of service on the ground of loss of confidence in the employee was valid. In Brooke Bond (India) (Private). Ltd. v. Sudhi Ranjan Ghosh [1962 - I L.L.J. 64), the standing orders of the concern provided for automatic dismissal of a workman remaining absent without notice for a period exceeding fourteen consecutive days. A workman who had remained absent in contravention of that order was dismissed by the management and the industrial tribunal set aside the order on the ground that the management ought to have given an opportunity to the concerned worker to explain his absence and that the punishment was extremely harsh. In quashing the award of the tribunal in a writ petition, the Calcutta High Court held that the employer was entitled to dismiss the worker by following the letter of the relevant clause of the standing order and that, as there was no mala fides on the part of the employers in dismissing the concerned workman, the industrial tribunal ought not to have imported consideration of harshness and violation of principles of natural justice in setting aside the order of dismissal. The last decision cited for the petitioner in this connexion is the decision of the Supreme Court in Burn & Co., Calcutta v. Their employees [1957 - I L.L.J. 226]. Amongst the persons dismissed, one Joydeb Banerjee was one of the employees who participated in the assault on a works manager. The Appellate Tribunal had held that as no charge was framed against him or an enquiry held, his dismissal was in contravention of the rules of natural justice and awarded him one year's backwages with dearness allowance as compensation. The Supreme Court set aside the order on the ground that even though no formal charge was framed against the employee, the order of dismissal had not been vitiated as the employee was aware of the charge against him and had an opportunity of giving his explanation. It had been further found by the tribunal that subsequent to the dismissal by the company there were conciliation proceedings and enquiry by the Labour Minister, as a result of which the order of dismissal of Banerjee remained untouched, though seven of his companions had been recommended for reinstatement. Their lordships concluded :
'In the face of these facts, it is idle for him to contend that he had been dismissed without hearing or enquiry. The order of the Appellate Tribunal awarding compensation should be set aside.'
17. From the facts and the aforesaid decisions, it is clear that the conclusion reached by the labour court was beyond its jurisdiction. It has overlooked the relevant provision of law and has considered the absence of a detailed enquiry as a ground for quashing the order, though Sub-section (1) of S. 41 quoted above does not require such prior enquiry to be held for dispensing with the services of an employee for any reasonable cause. We may incidentally observe in the present case that it would be difficult to say that the employer had no reasonable cause for terminating the services.
18. The last contention submitted for our consideration on behalf of the petitioner is that the respondent should have approached the Labour Commissioner under the provisions of the Act and that even if it is held that the labour court was competent to entertain his dispute, it was bound by the provisions of the Act in giving any relief which in its opinion the respondent was entitled to. In the present case, we refrain from deciding as to whether in the face of the provisions contained in S. 41 as regards the rights of an employee to appeal to the authorities constituted under the Act, the respondent could have sought his remedy under the Industrial Disputes Act, 1947. In deciding this dispute between the petitioner and the employee, the labour court could not have ignored the provisions contained in S. 41 of the Act. Sub- section (3) of that section lays down that where the services of a person have been dispensed with in contravention of the provisions of Sub-section (1), such a person shall be entitled to compensation equal to wages for a period not exceeding six months as calculated in the prescribed manner, 'where the employer does not agree to reinstate the employee.' Even if the conclusion of the tribunal had been upheld, it could not have ordered the reinstatement of the respondent in view of the aforesaid provision, it should have passed an award only for compensation. Sri Seshadri has drawn our attention to certain decisions which support his submission that a labour court or tribunal is bound by a local enactment even in deciding dispute under the Industrial Disputes Act. In May and Baker (India), Ltd. v. Their workmen [1961 - II L.L.J. 94], the Supreme Court laid down that -
'In the case of employees governed by the provisions of Delhi Shops and Establishments Act (VII of 1954), it is not open to the industrial tribunal - adjudicating the dispute relating to leave facilities - to allow accumulation of the privilege leave for a period exceeding the one mentioned in S. 22(1)(b)(i) of the Act. * * *'
19. Accordingly, it was held that the award of the industrial tribunal allowing the accumulation of privilege leave contrary to those provisions was bad in law. The other two decisions of the Supreme Court in Dalmia Cement (Bharat), Ltd., New Delhi v. Their workmen [1961 - II L.L.J. 130] and Marina Hotel v. Their workmen [1961 - II L.L.J. 431], affirm the same principle of law. It is not shown by the learned advocate for the respondent that the provisions contained in S. 41 of the Act are inconsistent with any of the provisions contained in the Industrial Disputes Act. He, however, relied upon a decision of the Supreme Court in Assam Oil Company, Ltd., New Delhi v. Its workmen [1960 - I L.L.J. 587], where it was laid down that even where an employer terminates the services of his employee under the terms of the contract, it was still open to the labour court to find out if the power had been utilized mala fide or by way of victimization of the employee. As observed above, the labour court dose not hold that the order of termination of the services of the respondent was either mala fide or was actuated by a spirit of victimization for his being a member of the workers' association.
20. In the result, we have no hesitation in holding that the award passed by the labour court is not valid and deserves to be quashed. We accordingly allow the writ petition and quash the award passed by the labour court. In the circumstances of the case, we make no order as to costs.